Dnata Travel has taken a majority stake in UK cruise-and-stay retailer Imagine Cruising.
The deal, which exchanged on Monday, sees the Emirates-owned company take a 51% stake in the Swindon-based cruise specialist, which was set up four years ago.
It becomes dnata’s latest UK acquisition since snapping up Travel Republic, Gold Medal and most recently, Stella Travel Services.
The Imagine Cruising deal is still subject to regulatory approval in South Africa, where both companies have travel interests, but divisional senior vice president of dnata’s travel business, Iain Andrew, said this was “not expected to be a difficult procedure and should complete in April/May”. He declined to reveal the transaction value.
Speaking exclusively to Travel Weekly, Andrew said: “We wanted to expand our product portfolio and cruise is where we needed to develop a broader offering. This deal allows us to focus on two key areas of growth – our international strategy and also new-to-cruise.”
Andrew explained dnata had already been working with Imagine co-founders Robin Deller and Natalie Legg in Dubai where the pair were hoping to emulate the success of their operation in South Africa offering cruising to a new source market.
Talks had begun with dnata to supply flying for the venture, but Andrew said: “We were focused initially on our Dubai relations, which were very small compared to volumes in the UK, but it was starting to get good pick-up by ex-pats and UAE nationals. But as we got to know Robin and Natalie, we became extremely impressed by their capability and decided to explore the partnership further.”
Imagine Cruising managing director Deller said: “We demonstrated in Africa where there was no appetite initially, that there is plenty of opportunity as long as you offer product and market in a way that’s relevant. We saw results that were outstanding in a short period of time, so after our success there, the UAE became a clear opportunity for us.”
Andrew said Imagine’s blueprint in South Africa and in the UAE could act as a springboard to launching similar cruise operations in other markets where dnata has “assets and distribution” and that these would be identified in time.
Deller explained the deal would also drive growth through new-to-cruise customers.
“The deal gives us the perfect opportunity to now sell cruise to Travel Republic customers. We have done a small amount of testing and the results were what we wanted, and so we can do something more significant,” he said.
Asked why they thought selling cruise through an OTA with a history of selling mostly beach holidays would be successful, Deller said: “I started in the holiday industry selling holidays on Teletext. I then went specialist, first with ski and then cruise and they do require different skills sets. If you don’t have the skills, it’s best to stay out of it, which is what Travel Republic has done to date, but now we can bring that expertise.”
Andrew added: “We have a number of great assets in Travel Republic such as great technology, servicing, brand and a fantastic customer database which is remarkably diverse. There may be a bit of a misperception about it, but it’s actually much broader than you might have thought, so whether it’s Imagine’s ‘Masterpiece’ collection or more regular cruises, we think there’s opportunity.”
Deller explained Imagine worked in three ways – acting as an agent on behalf of the cruise line selling its brochure cruises, offering more tailormade options but adding a few nights pre and post onto sailings, and then ‘Masterpiece’ where it creates completely bespoke “bucket list” itineraries, such as combining the Orient Express with an Italian Lakes holiday followed by a Mediterranean cruise.
“What we’re good at is identifying customers and trying what products work best for them. But it takes time.”
Asked how the Imagine Cruising acquisition might affect dnata’s other acquisitions of Gold Medal and Stella Travel Services, Andrew said: “Imagine Cruising brings a deep understanding of a key travel market, one which will enhance the product offering of each company within the dnata family.
“It’s the only area of overlap and we need to sit down and work out where it slots in but we made this investment so that our cruise interests in the UK can be led by Robin and his team. Imagine will lead the strategic development of cruise across dnata travel brands offering customers of Travel Republic, Gold Medal Travel Group and Stella Travel Services an enhanced choice of unique cruise holidays.”
He added: “We also need to see how it can work with Emirates Holidays and dnata Travel in the Middle East. We will now work out where across the business we can get the biggest return and start there.”
Deller said there would be no structural changes as a result of the deal, with everyone in his team remaining in place.
“The only change is that we will have additional needs so there will be job opportunities and career opportunities as we grow.”
The sale of a majority stake in Imagine Cruising is the second time Deller has built up and sold a cruise retailer to a larger player. He previously sold cruise and ski specialist Fast Track Travel to Virgin Holidays in 2007 so the operator could create Virgin Cruises.
He said: “It’s not strategic. We’re just very good at differentiating and being different and successful is very attractive to investors. I’m very proud of it and it’s a completely new and exciting era for me now. There is lots that we can look forward to and I’m very passionate and excited about the opportunity.
Andrew said Imagine Cruising completed dnata’s immediate ambitions in the UK.
“I wouldn’t say no to more product but I’m not actively looking for anything else at the moment. I’m a big fan of the UK travel industry and what it has to offer but we have a fair amount now.
“We’ve had a busy 12 months with seven or eight projects such as Gold Medal and Stella Travel, we’ve set up in Iraq and the Philippines, bought into Imagine, we’re bringing together Emirates Holidays and Mice into dnata Travel and we’ve still got a couple of other exciting projects happening in other parts of the world.
“We now need to sit and absorb it all.”
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